Economy Boom V.S. Gil-SellingFollow

Let me tell you :D

First off, the free market economy is determined by supply and demand. If there is a large supply with little demand, prices drop. If there is small supply with large demand, prices skyrocket. Now, as more money becomes available, it impacts the economy negatively : more liquid assets = more buying power + no change in the supply = prices increase.

Now enter the gilsellers. Previously, the wealth required to purchase the "best" gear was restricted to higher level characters, those midlvs with patience to farm for weeks and months on end, those lucky enough to find a solid and capable BCNM group at level 40, or those with random luck to get valuable drops off the lowlv NMs (JEJ, HMT, LL, Mee Deggi, etc).

With the advent of gilselling, wealth no longer became dependant on skill or dedication. By putting extreme amounts of gil at the disposal of lower level characters, they were enabled to enter a market they otherwise would have not been in, thusly increasing demand, while the supply stayed the same.

Higher demand + stagnated supply = inflation.

As if this wasn't bad enough, the gilsellers are not content until they monopolize a particular drop. If they are on stropers 24-7, chances are they're getting the majority of the drops. Therefore they have limited control over the supply of materials. I say limited because a complete monopoly is virtually impossible in the game setup for one specific group. This limited control, however, enables them to raise prices easily, when they're turning in the largest number of drops each week. On top of this, those non-gilsellers who are able to get the drop see the rising price and follow suit, in an effort to increase their gil/hour farming rate. Thusly the unwitting alliance between the gilsellers and the other campers results in the dreaded total monopoly.

So now you have a group in moderate control of both the flow of gil to lower levels and also in majority control of the drops their potential clients want. They set prices higher and higher, they supply the gil to buy their own items, and presto, extreme economic inflation. The problem is that they're recycling their own gil:

GilbuyerSteve buys 1,200,000g for $100. He purchases 2 Archer Rings for 600k each, buying them both from the gilsellers working for the company he bought the gil from. In essence, the company makes $100 profit, w/o having their supply of gil depleted, thus allowing them to sell 1,200,000g to the next guy...and the cycle repeats. The falling prices of gil on the net are prime proof of this cycle. Their supply of gil is huge as they get drops and recycle their gil, so they're able to lower their USD prices to make their service more attractive, get more customers, and perpetuate the cycle of inflation.

Hope this helps.

Lalryn understands completely.

here's the meat of it....



PROVE IT



Take one person you suspect of being a gil seller and PROVE IT.


Not a "he told me" because that becomes he said, she said and gets you no where. But proof. Show proff that this person has taken their item, sold it, and then sold the earned gil.


This is in effect what you are asking SE to do. And they may have tools built into the servive that will flag things that APPEAR to be bots, or APPEAR to be suspicios. But couldn't they just be someone using a turbo controller? Or someone using a PC with the keyboard repeat rate set to an insanely low value? yes... the COULD be...so....again... PROVE IT.


If SE or anyone else is going to have any luck in shutting it down, that's what they need to do. TO prove my point, look at SOE and Everquest....7 years later and people are still selling plat and items..and SOE is powerless to stop it. Why? Because they can't PROVE IT.

The simplest thing in the world would be to just take the EULA and go to court and throw it a IGE and say "Hey, you cant do that because the EULA says you can't!". Right? Except all IGE has to do is say "we don't play the game...so we aren't bound by your EULA".. Whoops....case dismissed.

That's exactly what this is all about! IGE's money is not magically produced from nowhere, bu the game will have to do something about it, and I believe that they will.

Rate up ^^; {hmmm.} Do I have to have scholar status to rate up?

Well in due fact, there is a way to prove it. yes turbo controllers and auto-voking bots are ways that one could use to quickly snag a NM. Though, when you're a high level RDM/THF and train some gobs in the peacock charm room with 15+ players ready to voke the NM (with that lame *** spawn time) you know for damn sure no one is there in front of the keyboard. If this IS ok for people to do, then why are they putting a quick stop to fishing-bots or magic skillup-bots? I've known people who have gotten their account frozen for about a week for it. Hell, my fishing is at like, 1! My enhancing and summoning magic can be better too. People complain about higher prices in the AH. I see it only getting worse, so start saving up and buy what you need now! lol

I also thing they should make the inventory space larger! I'm running out of room from all of these ex/rare items!
Hmmm. This is what I dont get, you can have 55 slots open and carry only 55 ores. (dont see why you cant carry them in a sack) but you can also juggle 55 beds in your inventory! WTF is that? Reality not being tied in with this game or anything, but c'mon! hook us up with some more space! 55 slots/80 safe/80 storage isn't cutting out, even with 2 mules!

He. Furthermore, none of the arguments I made in any way overestimate anything. In fact, I was patently generous in my allowances.



No. Sniper Rings going from 300k to 800k in about 4 weeks is not "normal effects of supply and demand". A 266.6% rate of inflation is not normal. As a point of reference, in the United States, the current rate of inflation is a little over 3% as of October, with a YTD average of about 2.7%. Granted, the political and economic situation of the US is different; I'm quoting it simply to give an idea of what "normal" is in a somewhat healthy economy. How are newer players even ABLE to afford such horrible markups? I presented a few possibilities in my first post, but the one that's far easier, and becoming more and more preferred: BUY GIL!



"Stagnation" implies that the supply is remaining the same over an extended period of time. This is simply the cold hard fact of the matter. The rings were camped almost 24-7 before the gilsellers, the rate of drop has not increased, therefore the approximate number of rings are dropping and being listed has not varied greatly. Since the price did not increase sharply like it has now, the only viable conclusion is that the supply has stagnated in that it has not gotten any larger while the demand has grown exponentially. Take now into account who is listing the rings? When did the sharp price increase begin? It's hardly coincidental that it began when the gilsellers started their perma-camp. Just look on the sell list: I checked it a few days ago, and various known gilsellers had 7/10 sales.

As far as IGE "magically" printing up money: they're doing all but. If you paid attention to and understood my GilbuyerSteve illustration, you would understand how the gil recycle works, which is at its core economically devestating. Their money comes back to them easy as pie when they are able to control the drops that folks buy with the gil they bought. That means their supply is doing nothing but going up, allowing them to reduce their prices to make gilbuying all the more attractive.

You give large amounts of money to folks who wouldn't normally have it, extreme inflation is going to result, and the economy will fail. Look at Russia after the Soviet collapse. The problem: The people are poor! The solution: get more money out! So they printed a ton of money, distributed it, and what happened? The monetary unit collapsed, and it took buckets of money to buy things like bread! Now let's apply it to us: Gilfarmers get the drops that folks want. Gilselling companies give large amounts of gil to folks who wouldn't otherwise have it, exponentially increasing demand. Gilsellers increase the cost of the drops because they know damn well demand is going up. Gilbuyers buy the drops the gilfarmers get, and the gil from the purchase goes directly back into the company's pockets. They lower gil prices, and more folks buy gil. Repeat. Repeat. Repeat. End result: EXTREME INFLATION.

I'm terribly sorry that you don't see the plain, simple, and blatantly logical nature of this exercise, but the logic and facts remain sound. I also apologize if I missed the original intent of this thread, which I see now was a "Gilsellers aren't really so bad after all" emotional plea. Sorry to rain on your parade, but I'm not about to let the Bleeding Hearts of Ragnarok Association (that's the BHRA, for those keeping track *wink*) downplay a serious problem that has catastrophic implications for the future of the server economy. If it's like this now, what will it be like in 6 months? A year?

That said, Lenelle, you did stumble onto the solution to the problem. The only, and I mean ONLY way that this will be fixed is if:

1) Folks stop buying gil (It's lame, so quit it. Play the game like the rest of us)
2) Folks stop accepting the gilsellers insane prices and refuse to buy their merchandise (Fat chance, I know)
3) SE gets off their lazy, rich, bloated butts and actually UPHOLDS their end of the EULA and ToS, and starts hiring GMs with backbones who will stand up and not be content to simply regurgitate answers handed to them by the Corporate Office.

Sorry for the long posts, wish I could explain it in a diagram or somethin >< (if any of you are artistically inclined and want to try to diagram it in a witty and humorous way, I'd love to see it! :D) Hope this helps clear up any remaining shadows of doubt.

Wo, wo, wo... get over yourself. You happen to have an opinion and you think that people are bad mouthing you outside of this thread because of it. I have not been a part of TSHot for long and I have never once heard Lalryn using any "foul" words about anyone, or even totally disrespecting someone.

Don't try to defend your POV by trying to make someone else look bad. Thank you, and take care.

I made an entirely sincere request of you. Things like, "get over yourself" are intended as insults that I will not stand for. You have twisted this thread from an ecnomical statement to plain ranting. Where I come from, we call that spam.





It seems that it is more your company than yourself that are provoking the situation. I'll send you a tell this evening, Lalryn. I happen to know some members of your company rather well and know for certain that they are not in any intention to create tension between us.

You'll hear from me soon,
Ayashi

Ayashi, your "entirely sincere request" was mostly just drama and blind accusations.







Unless you have proof of these things (screenies, chatlogs, etc.), then all of these things are essentially libel against Lalryn, and I and his other friends in-game won't stand for that. Now, either make with the proof quickly, or hush up.

Edited, Sat Nov 20 11:59:22 2004 by Cydille

lalryn, I just want to say that is the most informative perspective I have seen regarding the Gilseller Crisis. I wish more people understood this fundamental problem as deeply as you do.

I do have 1 question though...
As prices go up on items [ Example of snipers now almost 900k a pop when they should be closer to 400k ] Gil sellers have control of more gil that they sell to IGE. As a result of IGE having tons of gil, prices to buy gil decreases. So with that said, are gilsellers ultimately doomed to there own demise because gil selling wont be profitable anymore because IGE can sell it so cheaply? Chances are I am missing something but if that is the case, then we just have to wait for gil sellers to lose interest because they arent making enough money anymore.

Thanks again lalryn

That's the uncertainty. If IGE continues to suck gil out of the market and place it into players' hands at lower and lower prices, yes there will come a time when the wages they pay their workers is less than the value of the time spent collecting.

Another issue is that IGE is just one of the gilselling companies. The problem is that IGE also owns a few of the others, in an attempt to pretend like there's "competition" between gil suppliers. In truth, there's only 1 or 2, maybe 3 companies out there, operating under different names (this allows them to dominate the search results on the various engines, blocking any smalltime operations from getting into the action [which incidentally is illegal, but good luck proving it!] but at the same time makes it look like there's healthy competition in the marketplace). What this does is gives the few companies out there a monopoly of the market. They're not going to give up any more real money than they have to. They lower prices just enough to undercut their competition, but once their profit margins start getting cut into, they'll freeze their prices. With only 1-3 companies out there, it's very easy to work together to insure that everyone makes money.

Think about it. They're a virtual business. Almost zero overhead. They don't rent a building; hell the most they pay is the monthy fee for accounts to deliver gil on all servers, and then a pittance to their suppliers. They've got folks who pay for XI giving them gil for 1/4 of what they sell it for. They make 200-400% profit on each sale, for sitting on their butts.

So short answer to your question: They -could- run themselves out of business, but only if they're stupid. They control the market, therefore they set prices, so they control their profit.

Hope this helps, any further questions feel free :)

This just in, Sadly.. nothing about gilsellers is positive. Even when they're dying.